Who picks up the tab in the Court of Claims anyway? It matters to you and your clients!
By: Craig S. Tuttle, Esq.
As Ohio’s General Assembly continues to propose and enact new legislation providing cover from civil liability for state employees or agents, we as practitioners are seeing the practical impact of that legislation: disappearing pockets of recovery! With every ‘immunity statute’ enacted, the incentive for tortfeasors to exercise reasonable care disappears, and yet another client is denied just compensation for legitimate claims.
This troubling trend persisted in Ohio’s Court of Claims over the past decade, as immunity for State employees continually expanded, shifting the burden of bearing responsibility for the damages created by the wrongdoer from the private insurance carriers, to the citizens of Ohio through the state budget. This is especially true with physicians in Ohio, as recent decisions continue to broaden health-care practitioner immunity.
The Court of Claims of Ohio was created by statute, and is the court with original jurisdiction to hear suits against the State of Ohio. Torts and other claims arising out of the conduct of state employees or agents, who are acting within the scope of their state employment, may only be asserted against the State in the Court of Claims, assuming immunity attaches to that employee’s actions. The Court of Claims, upon the request of any party or the employee, ultimately determines whether a state agent or employee is entitled to personal immunity, and may even require an evidentiary hearing before deciding the issue. In essence, however, the employee is not entitled to immunity if either the conduct was “manifestly outside the scope of the officer’s or employee’s employment or official responsibilities” or the “officer or employee acted with malicious purpose, in bad faith, or in a wanton or reckless manner.”
Arguments over whether a particular officer or employee is immune typically center around what constitutes acting “within the scope” of their State employment. While this may seem relatively clear and simple, a review of the case law certainly compounds the issue. This is especially complex in the medical claims context, where the personal immunity for State employed or affiliated physicians has broadened consistently over the past decade. The current “bright-line test” for when a physician is entitled to personal immunity was established in Theobold and requires the court first to determine whether the practitioner is a state employee; if so, the court then determines whether the practitioner was acting on behalf of the State when the patient was allegedly injured. Further, the Theobold Court held that if education of students and residents was within the physician’s “state duties,” the trial court must determine “whether the practitioner was in fact educating a student or resident when the alleged negligence occurred.”
After Theobold, courts routinely granted physicians personal immunity so long as they could establish they were engaged in “teaching” activities when the alleged negligence occurred. Most recently, in 2013, the Supreme Court yet again expanded physician immunity in Ries v. Ohio State University Medical Center. Instead of reiterating the “teaching” requirement or test, the Court found the scope of employment to include when “the employee’s actions advance the interests of the state as defined by the duties of the state employee.” In essence, if the state employee’s duties include treating patients in the hospital, and the state employee was treating patients at the time of the alleged negligence, that physician is entitled to immunity. While the Ries decision clearly applies to state employee physicians, it is easy to foresee how the broad analysis and interpretation of what constitutes the “scope of employment” could easily be applied in non-medical claims against the State.
If you are ultimately forced into the Court of Claims as a result of personal immunity, this is not necessarily a bad thing. The negative aspects of litigating in the Court of Claims include the fact that a potential verdict or settlement is going to be paid out of the State budget, either from an agency or University budget. This means we, as well as our clients, are the ones actually bearing the burden of state employee negligence, rather than the private insurance carrier. Further, claims against the State have more restrictive caps on damages. Any judgment in the Court of Claims must be reduced by any collateral or insurance benefits received by the injured party. Further, the plaintiff’s health insurance carrier has no right to assert subrogation claims against the state. It is unclear whether those insurance carriers may have a cause of action for reimbursement against the patient, following the patient obtaining judgment against the State. For claims against State universities, other than wrongful death claims, noneconomic damages are limited by statute to no more than $250,000 per person, regardless of the severity of the injury or the extent of pain and suffering.
It is important to note, however, that the Court of Claims may not be “all bad” depending on the facts of your case. Most importantly, claims against the state do not trigger any concerns about “policy limits,” a common concern in common pleas matters being defended by insurance carriers. If you have a claim involving a state employee arguably acting within the scope of his or her employment, it may be more beneficial for your client to push for immunity, so that you can get into the Court of Claims where your client could receive potentially ‘full compensation’ for economic and non-economic damages. Imagine a scenario where your client is severely injured by a state employee who was driving a personal car from home to a meeting outside of the office for state-employment related purposes. There is a potential issue as to whether that employee is acting within the scope of his or her employment. The state employee carries personal liability insurance of only $50,000, but your client has suffered severe and permanent injuries, has lost earnings of $500,000, and you have a life care plan valued at $1 million. If the employee were entitled to immunity for actions at the time of the crash, you can now pursue the claim in the Court of Claims, and can recover damages for past and future lost income, past and future medical treatment, property damage, and pain and suffering. In other words, your client could obtain a much better recovery than a potentially uncollectible excess judgment in the court of common pleas.
Ultimately, the key in deciding whether to fight for or against immunity is a decision that could have significant impact on your client’s case. We as practitioners must give careful consideration to all potential “coverage” issues, including the potential for a “full” or “fuller” recovery in the Court of Claims. Even if we find ourselves asking ‘why is this person entitled to immunity’ or ‘why should the state have to pay this claim’, the bottom line is the State budget just might be the best source of recovery for our clients.
Important practice note: it is advisable to file suit in both the common pleas court and the Court of Claims if there is a potential that a state employee was involved and negligent in your case. The statute of limitations is not tolled against the State until after the Court determines immunity. To avoid that statute of limitations expiring, it is best to file a companion case in the Court of Claims.
Theobold v. Univ. of Cincinnati, 111 Ohio St.3d 541, 2006-Ohio-6208, 857 N.E.2d 573.
137 Ohio St.3d 151, 2013-Ohio-4545, 998 N.E.2d 461.
R.C. 2743.02(D) and 3345.40(B)(2) (for claims against State universities).
R.C. 3345.40(B)(2) (for claims against State universities); Comm. Ins. Co. v. Ohio Dept. of Transp., 137 Ohio App.3d 728 (10th Dist.2000) (insurer’s claim for subrogation against the State was barred).
See Yacobozzi, D., Anyone know what to do? Sovereign immunity vs. health insurance reimbursement, OAJ Quarterly, July 2014, p. 13.
Non-economic damages would be subject to a cap of $250,000 per person for both ‘non-catastrophic’ injuries in claims against the State, R.C. 2315.18(B), as well as for any claims against a state university, R.C. 3345.40(B)(3).